3 Things Not To Do Before Buying a Home
One of the primary concerns people have when they start thinking about buying a home is what kind of loan they can secure, and where they can get it. Loan officers like Jim Galloway, a sales manager at Stearns Home Loans in Old Town, make the process of getting pre-approved for a loan easy and stress-free.
Like credit scores, though, the loan approval process has a lot of moving parts, and several factors affect the rates you can get and maintain, so Jim gave us a few tips about what to keep in mind in order to get and keep a pre-approval rate that works well for you.
Here, in Jim’s words, are some things to avoid during the home-buying process to ensure that your transaction goes smoothly:
1) Don’t make an expensive purchase.
Many new homebuyers make the mistake of rushing out to buy things to fill their new home with as soon as the seller accepts the purchase offer and the lender pre-approves their loan. It may be tempting to order that new sofa for your soon-to-be living room, but it’s best to avoid making major purchases like furniture, cars, appliances, electronic equipment, jewelry, or vacations until after closing occurs.
It’s important to note that there are still a few important steps involved with the lending process prior to the keys being handed over. Financing furniture with a credit card could jeopardize your credit worthiness during the time it means the most. Using cash to purchase big items can also create a problem, because many banks take your cash reserves into consideration when approving your mortgage.
2) Starting a new job may cause concern.
Lenders like to see a consistent job history. A recent change in employment, especially if there have been a number of job moves in the recent past, amongst a flat or even diminishing income pattern, may cause a lender additional concern in documenting stable income.
3) Don’t switch banks or move money around.
As your lender reviews your loan package, you will likely be asked to provide bank statements for the last two to three months on your checking and savings accounts, money market funds, and other liquid assets. To eliminate potential fraud, most loans require a thorough paper trail to document the source of all funds. Changing banks or transferring money to another account—even if it’s just to consolidate funds—could make it difficult for the lender to document your funds.
Jim has a lot more expert advice to offer. If you’d like to get in touch with him, see his profile here. We can personally attest that he’s a great guy, fun to work with and really knows his stuff! A good realtor will be sure to set you up with a trusty and reliable loan officer, and that is just one area where The Patterson Group’s local connections and thirty years of experience can benefit you greatly! Please call us if you have questions or are thinking about buying a home.
- About the team
The Patterson Group is one of the most experienced and trusted real estate teams in the area, serving Alexandria, VA for over thirty years. We offer professional, hardworking, detailed and friendly service and a large network of contacts and resources accrued over our many years in Alexandria real estate. Comprised of seven Alexandria locals, six of whom are licensed realtors and three of whom are accredited staging professionals, The Patterson Group is passionate and knowledgeable about Alexandria, VA and here for all of your Northern VA real estate needs. Allow us to help you find your home here and discover all that the Alexandria lifestyle has to offer.
400 South Washington Street
Alexandria, VA 22314
703.310.6201
